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tvWORKS . What is tvWORKS?. Single source piece of research covering: FMCG purchasing TV viewing Conducted independently by TNS 3000 homes nationally Unique 5m purchases 28 FMCG product categories = 243 brands 3 years of data to December 2003

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Presentation Transcript

What is tvworks
What is tvWORKS?

  • Single source piece of research covering:

    • FMCG purchasing

    • TV viewing

  • Conducted independently by TNS

  • 3000 homes nationally

  • Unique

  • 5m purchases

  • 28 FMCG product categories = 243 brands

  • 3 years of data to December 2003

  • Results analysed in terms of purchase occasions


The power of tv
The Power of TV

  • Overall, TV advertising continues to produce an immediatesales boost.

  • On average, it gives a 4.4% uplift in purchases in the first4 weeks after advertising was seen.

  • However, the incremental purchases continue beyond thisfirst month.

Source: tvWORKS, Jan01-Dec03, seen at least 1 spot in prior 28 days


TV advertising works very well

to drive sales of launch brands

New brands

Established brands

Brands in high interest categories

e.g. Toiletries, Ready meals

tend to show higher than average % sales growth

For large established brands

& staples, % sales growth

is much smaller but in

£s is significant

TV Advertising is effective at all stages ofa brand’s lifecycle

Increase in purchasing within 4 weeks

Source: TNS Mediaspan, database of case studies, 1995-2002


Tv advertising continues to drive sales after the first month
TV Advertising continues to drive sales after the first month

  • The effect of TV advertising actually works beyond the first month after the advertising was seen.

  • For every brand bought, as a result of advertising, a consumeris likely to make 4 more purchases than expected of that brand within the year.

  • So looking at the effect of advertising in the first month alone under-values the power of TV advertising by excluding these extra purchases.

  • At the same time, over the long-term advertising buildsbrand equity

Source: tvWORKS, Jan01-Dec03


Itv1 outperforms in terms of incremental purchases
ITV1 outperforms in terms of Incremental Purchases month

% of incremental purchases vs % of FMCG impacts

Source: tvWORKS, Jan01-Dec03, each channel’s % of incremental purchases attributable to TV where at least 2/3rds of spots seen in prior 28 days were on a single channel / NMR, FMCG category, based on housewives ratecard weighted impacts


Peak accounts for the greatest amount of incremental purchases
Peak accounts for the greatest amount of Incremental Purchases

% of incremental purchases vs % of FMCG impacts

Source: tvWORKS, Jan01-Dec03, each daypart’s % of incremental purchases attributable to TV where at least 2/3rds of spots seen in prior 28 days were in a single daypart / NMR, FMCG category, based on housewives ratecard weighted impacts


Benchmarks by product type
Benchmarks by Product type Purchases

% increase in purchasing in first 4 weeks

Source: tvWORKS, Jan01-Dec03, seen at least 1 spot in prior 28 days


Itv1 is the most effective channel at driving sales
ITV1 is the most effective channel at driving sales Purchases

ITV1’s % of incremental purchases vs % of FMCG impacts

Source: tvWORKS, Jan01-Dec03, ITV1’s % of incremental purchases attributable to TV where at least 2/3rds of spots seen in prior 28 days were on a single channel / NMR, FMCG category, based on housewives ratecard weighted impacts


Tv effectiveness by home type and demograph

Home type makes little difference Purchases

All 3 groups are more responsive than the average

TV Effectiveness by Home Type and Demograph

% increase in purchasing in first 4 weeks

Source: tvWORKS, Jan01-Dec03, seen at 1 spot in prior 28 days


How advertising promotions work together
How Advertising & Promotions Work Together Purchases

  • The majority (69%) of purchases made after exposure to TV advertising are not on price promotion

  • TV advertising generates a 4.0% increase in sales for this majority in the following 4 weeks

  • The remaining 31% of purchases made after seeing TV advertising are on price promotion. For these, advertising increases sales by 6.6% over and above the gain from the price cut

  • If you cut your price and tell people about the brand by advertising on TV you get a double boost in sales

Source: tvWORKS, 84 weeks to March 02, seen at least 1 spot in prior 28 days


Itv1 works better than other channels for full price purchases

ITV1 is most effective for brand building. Purchases

But for price promoted purchases there is little difference

in effectiveness regardless of channel choice

ITV1 works better than other channels for Full Price Purchases

% increase in purchasing in first 4 weeks

Source: tvWORKS, 84 weeks to March 02, seen at least 1 spot in prior 28 days


Low loyal consumers respond most to tv advertising

Contribution to Sales Uplift Purchases 57% 27% 15%

Low Loyal Consumers respond most to TV Advertising

% increase in purchasing in first 4 weeks

Source: tvWORKS, Jan01-Dec03, saw at least 1 spot in prior 28 days, loyalty reflects spend on brand as

% of spend on category, low loyal = 0-10%, medium loyal = 10-39%, high loyal = 40-100%


The importance of low loyal consumers
The Importance of Low Loyal Consumers Purchases

  • Low Loyal Brand Buyers respond most to TV advertising because:

    • they know least about the brand

    • TV advertising has the most to say to them

  • These buyers are important since they may become the core buyers of your brand in the future.

  • Nevertheless even the most loyal buyers are influenced to a small degree by TV advertising seen recently.


Promotions attract deal buyers while tv encourages trial purchasing

Value for Purchases

money

purchasing

Trial

purchasing

Promotions attract Deal Buyers while TV encourages Trial Purchasing

% Share of Purchasing by Consumer Group

Source: tvWORKS, 84 weeks to Mar02, loyalty reflects spend on brand as % of spend on category, low loyal = 0-10%,medium loyal =10-39%, high loyal = 40-100%, deal buyers buy at least 50% more brand purchases on promotion


Tv advertising reaches more valuable customers

£28.65 Purchases

Total

£27.12

TV advertising reaches those prepared to buy at full price

TV Advertising reaches more Valuable Customers

Annual value of brand buyers

Source: tvWORKS, 84 weeks to March 02, seen at 1 spot in prior 28 days


Reach of brand purchases from tv advertising vs promotions
Reach of brand purchases from TV advertising vs promotions Purchases

Source: tvWORKS, 84 weeks to Mar02, saw at least 1 spot in prior 28 days, loyalty reflects spend on brand as % of spend on category, low loyal = 0-10%, medium loyal = 10-39%, high loyal = 40-100%, deal buyers buy at least 50% more than the average person of their brand purchases on promotion


Increase in likelihood to purchase
Increase in likelihood to purchase Purchases

Inter purchase interval

number of advertising exposures

Source: tvWORKS, Jan01- Dec03, exposure seen in inter-purchase interval


Increase in purchasing within 4 weeks
Increase in purchasing within 4 weeks Purchases

%

number of exposures seen within time interval

Source: tvWORKS, Mar96-Mar98, Meridian


Increase in purchasing within 4 weeks1

3+ exposures Purchases

2+ exposures

1+ exposures

Increase in purchasing within 4 weeks

50%

40%

30%

20%

10%

0

0

3

7

14

21

28

Days prior to purchase

Source: tvWORKS, Mar96-Mar98, Meridian


Increase in purchasing within 4 weeks2

3+ seen within 1 day Purchases

3+ seen within 2 days

3+ seen at any time

Increase in purchasing within 4 weeks

50%

40%

30%

20%

10%

0

0

7

14

21

28

Days prior to purchase

Source: tvWORKS, Mar96-Mar98, Meridian


3 alternative schedule deployments
3 alternative schedule deployments Purchases

Continuous

Burst

Pulsing

Month 1

Month 12


Pulsing is the most effective strategy
Pulsing is the Most Effective Strategy Purchases

Incremental sales index

100 = 2600 tvrs in continuous strategy

TVRs

Source: tvWORKS, Mar96-Mar98, Meridian


No tv advertising for a year produces a 13 decline in purchasing
No TV Advertising for a year produces a 13% decline in Purchasing

Sales index

Minimum days elapsed since advertising was last seen

Source: tvWORKS, 2 years to Jan03, the sales index compares the amount of purchasing of the brand at each point in time to the amount of purchasing at the control (when advertising had been seen in the last 28 days).


Brands on promotion decline more quickly without tv advertising
Brands on Promotion decline more quickly without TV Advertising

Sales index

Minimum days elapsed since advertising was last seen

Source: tvWORKS, 2 years to Jan03, the sales index compares the amount of purchasing of the brand at each point in time to the amount of purchasing at the control (when advertising had been seen in the last 28 days).


Lightly advertised brands decline faster in the absence of tv advertising
Lightly Advertised Brands decline faster in the absence of TV Advertising

Sales index

Minimum days elapsed since advertising was last seen

Source: tvWORKS, 2 years to Jan03, heavily advertised brands spent £10m+ on TV over prior 3 years (1999-2001), lightly advertised brands spent

£2.5m or less on TV over the same 3 years, the sales index compares the amount of purchasing of the brand at each point in time to the amount

of purchasing at the control


The low loyals are most effected by the absence of tv advertising
The Low Loyals are most effected by the absence of TV Advertising

Sales index

Minimum days elapsed since advertising was last seen

Source: tvWORKS, 2 years to Jan03, loyalty reflects spend on brand as % of spend on category, low loyal = 0-10%, high loyal = 40-100%, the sales index compares the amount of purchasing of the brand at each point in time to the amount of purchasing at the control


Conclusions
Conclusions Advertising

  • Television advertising is effective at all stages of a brand’s lifestyle

  • Calling a halt to television advertising leads to a fall in brand sales

  • TV advertising delivers an average sales uplift of 4.4% with 4 weeks of the advertising being seen, and then delivers on average 4 further purchases during the year

  • More lightly advertised brands suffer from a lack of TV presence in comparison with those making a larger investment in television

  • TV advertising encourages trial purchasing and helps recruit a new generation of loyal customers to replace those that are lost


Conclusions1
Conclusions Advertising

  • A pulsing deployment of advertising is highly effective

  • Peak time advertising delivers the greatest amount of incremental purchases

  • Whether leading brands, premium brands, staple or new brands, ITV1 is better at increasing purchasing than other TV channels

  • Likelihood of consumer purchase increases with frequency and recency of exposure to TV advertising

  • ITV1 is the most effective channel at building sales

  • Cutting adspend is detrimental to medium and long-termbrand growth


Notes on methodology
Notes on Methodology Advertising

  • Each panel household was given set top meters to record their TV viewing and a bar code scanner to collect the details of all grocery products brought into the home.

  • All brands within the 28 FMCG categories which had been active on TV were selected giving a database of 243 brands. Thus there was no bias in the brands chosen and it was “the world as found”.

  • The research looks at the effects of advertising in the first month after it was seen. The effect of TV is calculated by comparing the number of purchase occasions of brand X in homes that saw advertising for that brand in the last 28 days with the number of purchase occasions of brand X in matched sample homes that did not see advertising.


Notes on methodology1
Notes on Methodology Advertising

  • So, if the homes seeing Brand A's advertising are responsible for 210 purchase occasions of Brand A, and the homes which did not see Brand A's advertising are responsible for only 200 purchase occasions, the difference is +10 in favour of the group that saw TV advertising. This represents +5% incremental uplift on the "expected" level of purchasing of 200 and is attributed to the effects of TV advertising.

  • The uplift can be attributed to TV advertising because the effects of price promotion, previous brand loyalty & weight of viewing have been removed by the matched sampling.


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